How Much Does IRC's (HKG:1029) CEO Make?

Yury V. Makarov became the CEO of IRC Limited (HKG:1029) in 2010, and we think it's a good time to look at the executive's compensation against the backdrop of overall company performance. This analysis will also look to assess whether the CEO is appropriately paid, considering recent earnings growth and investor returns for IRC.

See our latest analysis for IRC

How Does Total Compensation For Yury V. Makarov Compare With Other Companies In The Industry?

According to our data, IRC Limited has a market capitalization of HK$1.1b, and paid its CEO total annual compensation worth US$890k over the year to December 2019. Notably, that's a decrease of 17% over the year before. In particular, the salary of US$708.0k, makes up a huge portion of the total compensation being paid to the CEO.

On comparing similar-sized companies in the industry with market capitalizations below HK$1.6b, we found that the median total CEO compensation was US$139k. Hence, we can conclude that Yury V. Makarov is remunerated higher than the industry median. What's more, Yury V. Makarov holds HK$4.9m worth of shares in the company in their own name, indicating that they have a lot of skin in the game.

Talking in terms of the industry, salary represented approximately 84% of total compensation out of all the companies we analyzed, while other remuneration made up 16% of the pie. Our data reveals that IRC allocates salary more or less in line with the wider market. If total compensation veers towards salary, it suggests that the variable portion - which is generally tied to performance, is lower.

IRC Limited's Growth

IRC Limited has reduced its earnings per share by 50% a year over the last three years. In the last year, its revenue is up 14%.

Few shareholders would be pleased to read that EPS have declined. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for us to put aside my concerns around EPS. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Historical performance can sometimes be a good indicator on what's coming up next but if you want to peer into the company's future you might be interested in this free visualization of analyst forecasts.

Has IRC Limited Been A Good Investment?

Since shareholders would have lost about 40% over three years, some IRC Limited investors would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.

In Summary...

As previously discussed, Yury V. is compensated more than what is normal for CEOs of companies of similar size, and which belong to the same industry. This doesn't look good against shareholder returns, which have been negative for the past three years. To make matters worse, EPS growth has also been negative during this period. Considering such poor performance, we think shareholders might be concerned if the CEO's compensation were to grow.

While CEO pay is an important factor to be aware of, there are other areas that investors should be mindful of as well. That's why we did some digging and identified 1 warning sign for IRC that you should be aware of before investing.

Of course, you might find a fantastic investment by looking at a different set of stocks. So take a peek at this free list of interesting companies.

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